KUALA LUMPUR: The Retirement Fund (Incorporated) (KWAP) has targeted a 70 per cent increase in environmental, social and governance (ESG) investment fund size in the future.

Its chief executive officer Datuk Wan Kamaruzaman Wan Ahmad said the current size of KWAP’s ESG investment fund is at 50 per cent to 60 per cent. This will be increased by up to 70 per cent depending on the liquidity of the market ecosystem.

“At the moment, there is no timeframe to achieve the target, but we are optimistic to further invest in stocks or ESG status assets.

“KWAP has started the ESG mandate in 2014 and the portfolio has performed well to date,” he said at the launch of the partnership between the retirement fund and a United Nation-backed body, Principles for Responsible Investment (PRI), here today.

KWAP became Malaysia’s first pension fund to join the free global policy-makers network to build a more established financial and economic system through long-term responsible investment principles.

Wan Kamaruzaman said KWAP’s focus was on implementing a strong ESG practice not only to improve long-term social security for retirees, but also be responsible for future generations.

“As Malaysia’s first pension fund in fulfilling our promise of PRI, we strive to continue our commitment to more responsible investments,” he said.

As a signatory to PRI, KWAP will continue to be committed in supporting and promoting the use of ESG practices, incorporating measures to focus on investors, which include reporting open-ended investment activities in line with six PRI principles.

KWAP now has RM125 billion assets under management (AUM), including RM2 billion allocated for ESG.